THE CHARTERED ACCOUNTANTS ACT, 1949 

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ARRANGEMENT OF SECTIONS 

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CHAPTER I 

PRELIMINARY 

SECTIONS 

1. Short title, extent and commencement. 

2. Interpretation. 

CHAPTER II 

THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 

3. Incorporation of the Institute. 

4. Entry of names in the Register of members. 

5. Fellows and Associates. 

6. Certificate of practice. 

7. Members to be known as Chartered Accountants. 

8. Disabilities. 

CHAPTER III 

COUNCIL OF THE INSTITUTE 

9. Constitution of the Council of the Institute. 
9A. Coordination Committee. 
10. Re-election or re-nomination to Council. 
10A. Settlement of dispute regarding election. 
10B. Establishment of Tribunal. 

11. Nomination in default of election or nomination. 

12. President and Vice-President. 

13. Resignation of membership and casual vacancies. 

14. Duration and dissolution of Council. 

15. Functions of the Council. 
15A. Imparting education by Universities and other bodies. 
15B.Functions of Institute. 
16. Officers and employees, salary, allowances, etc. 
17. Committees of the Council. 
18. Finance of the Council. 

CHAPTER IV 

REGISTER OF MEMBERS 

19. Register of members. 

20. Removal from the Register of members. 

21. Disciplinary Directorate. 

CHAPTER V 

MISCONDUCT 

1 

 
SECTIONS 

21A. Board of Discipline. 

21B. Disciplinary Committee. 

21C.  Authority,  Disciplinary  Committee,  Board  of  Discipline  and  Director  (Discipline)  to  have 

powers of civil court. 

21D. Transitional provisions. 

22. Professional or other misconduct defined. 

22A. Constitution of Appellate Authority. 

22B. Term of office of Chairperson and members of Authority. 

22C. Allowances and conditions of service of Chairperson and members of Authority. 

22D. Procedure to be regulated by Authority. 

22E. Officers and other staff of Authority. 

22F. Resignation and removal of Chairperson and members. 

22G. Appeal to Authority. 

CHAPTER VI 

REGIONAL COUNCILS 

23. Constitution and functions of Regional Councils. 

CHAPTER VII 

PENALTIES 

24. Penalty for falsely claiming to be a member, etc. 

24A. Penalty for using name of the Council, awarding degrees of chartered accountancy, etc. 

25. Companies not to engage in accountancy. 

26. Unqualified persons not to sign documents. 

27. Maintenance of branch offices. 

28. Sanction to prosecute. 

CHAPTER VII A 

QUALITY REVIEW BOARD 

28A. Establishment of Quality Review Board. 

28B. Functions of Board. 

28C. Procedure of Board. 

28D. Terms and conditions of services of Chairperson and members of Board and its expenditure. 

CHAPTER VIII 

MISCELLANEOUS 

29. Reciprocity. 

29A. Power of Central Government to make rules 

30. Power to make regulations. 

30A.  Powers  of  Central  Government  to  direct  regulations  to  be  made  or  to  make  or  amend 

regulations. 

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SECTIONS 

30B. Rules, regulations and notifications to be laid before Parliament. 

30C. Power of Central Government to issue directions. 

30D. Protection of action taken in good faith. 

30E. Members, etc., to be public servants. 

31. Construction of references. 

32. Act not to affect right of accountants to practise as such in Part B States. 

33. [Repealed.] 

THE FIRST SCHEDULE. 

THE SECOND SCHEDULE. 

3 

THE CHARTERED ACCOUNTANTS ACT, 1949 

ACT NO. 38 OF 1949 

An Act to make provision for the 1[regulation and development] of the 2[profession of chartered 

accountants]. 

WHEREAS  it  is  expedient  to  make  provision  for  the  1[regulation  and  development]  of  the 
2[profession  of  chartered  accountants]  and  for  that  purpose  to  establish  an  Institute  of  Chartered 
Accountants; 

It is hereby enacted as follows:— 

[1st May, 1949.] 

CHAPTER I 

PRELIMINARY 

1. Short title, extent and commencement.—(1) This Act may be called the Chartered Accountants 

Act, 1949. 

3[(2) It extends to the whole of India 4***.] 

(3)  It  shall  come  into  force  on  such  date5  as  the  Central  Government  may,  by  notification  in  the 

Official Gazette, appoint in this behalf. 

2. Interpretation.—(1) In this Act, unless there is anything repugnant in the subject or context,— 

(a) “associate” means an associate member of the Institute; 

6[(aa) “Authority” means the Appellate Authority constituted under section 22A; 

(aaa) “Board” means the Quality Review Board constituted under section 28A;] 

7[(ab) “Board of Discipline” means the Board of Discipline constituted under sub-section (1) of 

section 21A;] 

(b) “chartered accountant” means a person who is a member of the Institute 8***; 

7[(ba)  “Coordination  Committee”  means  the  Coordination  Committee  constituted  under  section 

9A;  

(bb)  “Companies  Act”  means  the  Companies  Act,  2013  (18  of  2013)  or  any  other  previous 

company law as defined in clause (67) of section 2 of the said Act;] 

(c) “Council” means the Council of the Institute 7[constituted under section 9]; 

9[(ca)  “firm”  shall  have  the  meaning  assigned  to  it  in  section  4  of  the  Indian  Partnership                       

Act, 1932 (9 of 1932), and includes,— 

(i) the limited liability partnership as defined in clause (n) of sub-section (1) of section 2 of 

the Limited Liability Partnership Act, 2008 (6 of 2009); or 

1. Subs. by Act 12 of 2022, s. 2, for “regulation” (w.e.f. 10-5-2022). 
2. Subs. by Act 15 of 1959, s. 2, for “profession of accountants” (w.e.f. 1-7-1959).  
3. Subs. by the A.O. 1950, for sub-section (2). 
4. The words “except the State of Jammu and Kashmir” omitted by Act 25 of 1968, s. 3 and the Schedule (w.e.f. 15-8-1968).  
5.  1st  July,  1949,  vide  Notification  No.  I  OA  (4)/49,  dated  1st  June,  1949,  see  Gazette  of  India,  Extraordinary,  Part  II,                  

sec. 3(i) and this Act has been extended in its application to the union territory Goa, Daman and Diu by Act 11 of 1963, s. 
3 and the Schedule (w.e.f. 1-2-1965). 

6. Ins. by Act 9 of 2006, s. 2 (w.e.f. 8-8-2006).  
7. Ins. by Act 12 of 2022, s. 3 (w.e.f. 10-5-2022). 
8. The words “and who is in practice” omitted by Act 15 of 1959, s. 3 (w.e.f. 1-7-1959).  
9. Ins. by Act 3 of 2012, s. 2 (w.e.f. 1-2-2012).  

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(ii) the sole proprietorship, 

registered with the Institute;] 

1[(cb)  “Director  (Discipline)”  means  the  Director  (Discipline)  referred  to  in  section  21  and 

includes Joint Director (Discipline); 

(cc) “Disciplinary Committee” means the Disciplinary Committee constituted under sub-section 

(1) of section 21B; 

(cd) “Disciplinary Directorate” means the Disciplinary Directorate established under sub-section 

(1) of section 21; 

(ce) “fellow” means a fellow member of the Institute;] 

(d) “holder of a restricted certificate” means a person holding a permanent or temporary restricted 

certificate granted by a State Government under the Restricted Certificates Rules, 1932; 

(e) “Institute” means the Institute of Chartered Accountants of India constituted under this Act; 

2[(ea) “notification” means a notification published in the Official Gazette and the term “notify” 

shall be construed accordingly;] 

3[(eb)  “partner”  shall  have  the  meaning  assigned  to  it  in  section  4  of  the  Indian  Partnership              

Act,  1932  (9  of  1932),  or  in  clause  (q)  of  sub-section  (1)  of  section  2  of  the  Limited  Liability 
Partnership Act, 2008 (6 of 2009), as the case may be; 

(ec) “partnership” means — 

(A) a partnership as defined in section 4 of the Indian Partnership Act, 1932 (9 of 1932); or 

(B) a limited liability partnership which has no company as its partner;] 

 (f) “prescribed” means prescribed by regulations made under this Act; 

4[(g) “Register” means the Register of members of the Institute maintained under section 19 or 

the Register of firms of the Institute maintained under section 20B, as the case may be;] 

(h)  “registered  accountant”  means  any  person  who  has  been  enrolled  on  the  Register  of 

Accountants maintained by the Central Government under the Auditor’s Certificates Rules, 1932; 

 3[(ha) “specified” means specified by rules made by the Central Government under this Act; 

5[(haa)  “sole  proprietorship”  means  an  individual  who  engages  himself  in  the  practice  of 

accountancy or offers to perform services referred to in clauses (ii) to (iv) of sub-section (2);] 

1[(haaa) “Standing Committee” means a Standing Committee constituted under sub-section (1) of 

section 17;] 

(hb) “Tribunal” means a Tribunal established under sub-section (1) of section 10B;] 

(i) “year” means the period commencing on the 1st day of April of any year and ending on the 

31st day of March of the succeeding year. 

(2) A member of the Institute shall be deemed “to be in practice” when individually or in partnership 
with  chartered  accountants  6[in  practice  7[or  in  partnership  with  members  of  such  other  recognised 
professions as may be prescribed]], he, in consideration of remuneration received or to be received— 

(i) engages himself in the practice of accountancy; or 

1. Ins. by Act 12 of 2022, s. 3 (w.e.f. 10-5-2022). 
2. Subs. by s. 3, ibid., for clause (ea) (w.e.f. 10-5-2022). 
3. Ins. by Act 9 of 2006, s. 2 (w.e.f. 8-8-2006). 
4. Subs. by Act 12 of 2022, s. 3,  for clause (g) (w.e.f. 10-5-2022). 
5. Ins. by Act 3 of 2012, s. 2 (w.e.f. 1-2-2012). 
6. Ins. by Act 15 of 1959, s. 3 (w.e.f. 1-7-1959).  
7. Ins. by Act 3 of 2012, s. 2 (w.e.f. 1-2-2012).  

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(ii)  offers  to  perform  or  performs  services  involving  the  auditing  or  verification  of  financial 
transactions,  books, accounts,  or  records  or  the  preparation,  verification  or certification  of financial 
accounting and related statements or holds himself out to the public as an accountant; or 

(iii) renders professional services or assistance in or about matters of principle or detail relating to 

accounting procedure or the recording, presentation or certification of financial facts or data; or 

(iv)  renders  such  other  services  as,  in  the  opinion  of  the  Council,  are  or  may  be  rendered  by  a 

chartered accountant 1[in practice]; 

and  the  words  “to  be  in  practice”  with  their  grammatical  variations  and  cognate  expressions  shall  be 
construed accordingly. 

Explanation.—An  associate  or  a  fellow  of  the  Institute  who  is  a  salaried  employee  of  a  chartered 
accountant  1[in  practice]  or 2[a  firm  of  such  chartered  accountants  or  firm  consisting  of  one  or  more 
chartered accountants and members of any other professional body having prescribed qualifications] 1[in 
practice] shall, notwithstanding such employment, be deemed to be in practice for the limited purpose of 
the 3[training of articled assistants]. 

CHAPTER II 

THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 

3. Incorporation of the Institute.—(1) All persons whose names are entered in the Register at the 
commencement of this Act and all persons who may hereafter have their  names entered in the Register 
under the provisions of this Act, so long as they continue to have their names borne on the said Register, 
are hereby constituted a body corporate by the name of the Institute of Chartered Accountants of India, 
and all such persons shall be known as members of the Institute. 

(2) The Institute shall have perpetual succession and a common seal and shall have power to acquire, 

hold and dispose of property, both movable and immoveable, and shall by its name sue or be sued. 

4.  Entry  of  names  in  the  4[Register  of  members].—(1)  Any  of  the  following  persons  shall  be 

entitled to have his name entered in the 4[Register of members], namely,— 

(i)  any  person  who  is  a  registered  accountant  or  a  holder  of  a  restricted  certificate  at  the 

commencement of this Act; 

(ii)  any  person  who  has  passed  such  examination  and  completed  such  training  as  may  be 

prescribed for members of the Institute; 

(iii) any person who has passed the examination for the Government Diploma in Accountancy or 
an  examination  recognised  as  equivalent  thereto  by  the  rules  for  the  award  of  the  Government 
Diploma in Accountancy before the commencement of this Act, and who, although not duly qualified 
to be registered as an accountant under the Auditors' Certificates Rules, 1932, fulfils such conditions 
as the Central Government may specify in this behalf; 

(iv) any person who, at the commencement of this Act, is engaged in the practice of accountancy 
in any Part B State and who, although not possessing the requisite qualifications to be registered as an 
accountant  under  the  Auditors’  Certificates  Rules,  1932,  fulfils  such  conditions  as  the  Central 
Government may specify in this behalf; 

5[(v)  any  person  who  has  passed  such  other  examination  and  completed  such  other  training 
6[outside India] as is recognised by the Central Government or the Council as being equivalent to the 
examination and training prescribed for members of the Institute: 

1. Ins. by Act 15 of 1959, s. 3 (w.e.f. 1-7-1959) 
2. Subs. by Act 3 of 2012, s. 2, for “a firm of such chartered accountants” (w.e.f. 1-2-2012).  
3. Subs. by Act 9 of 2006, s. 2, for “training of articled clerks” (w.e.f. 8-8-2006).  
4. Subs. by Act 12 of 2022, s. 4, for “Register” (w.e.f. 10-5-2022). 
5. Subs. by Act 40 of 1955, s. 2, for clause (v) (w.e.f. 21-10-1955).  
6. Subs. by Act 12 of 2022, s. 4, for “without India” (w.e.f. 10-5-2022). 

6 

                                                           
Provided  that  in  the  case  of  any  person  who  is  not  permanently  residing  in  India,  the  Central 
Government or the Council, as the case may be, may impose such further conditions as it may deem 
fit;] 

(vi)  any  person  domiciled  in  India,  who  at  the  commencement  of  this  Act  is  studying  for  any 
foreign examination and is at the same time undergoing training, whether within or  1[outside India], 
or,  who,  having  passed  such  foreign  examination,  is  at  the  commencement  of  this  Act  undergoing 
training, whether within or without India: 

Provided that any such examination or training was recognised before the commencement of this 
Act  for  the  purpose  of  conferring  the  right  to  be  registered  as  an  accountant  under  the  Auditors' 
Certificates Rules, 1932, and provided further that such person passes the examination or completes 
the training within five years after the commencement of this Act. 

(2) Every person belonging to the class mentioned in clause (i) of sub-section (1) shall have his name 

entered in the 2[Register of members] without the payment of any entrance fee. 

3[(3) Every person belonging to any of the classes mentioned in clauses (ii), (iii), (iv), (v) and (vi) of 
sub-section (1) shall have his name entered in the 2[Register of members] on application being made and 
granted in the prescribed manner and on payment of such fees, as may be determined, by notification, by 
the Council 4***. 

5* 

* 

* 

* 

*.] 

(4) The Central Government shall take such steps as may be necessary for the purpose of having the 
names  of  all  persons  belonging  to  the  class  mentioned  in  clause  (i)  of  sub-section  (1)  entered  in  the 
2[Register of members]. 

5.  Fellows  and  associates.—(1)  The  members  of  the  Institute  shall  be  divided  into  two  classes 

designated respectively as associates and fellows. 

(2) Any person shall, on his name being entered in the  6[Register of members], be deemed to have 
become an associate member of the Institute and be entitled to use the letters A. C. A. after his name to 
indicate that he is an associate member of the Institute of Chartered Accountants. 

7[(3)  A  member,  being  an  associate  who  has  been  in  continuous  practice  in  India  for  at  least  five 
years, whether before or after the commencement of this Act, or whether partly before and partly after the 
commencement of this Act, and a member who has been an associate for a continuous period of not less 
than  five  years  and  who  possesses  such  qualifications  as  the  Council  may  prescribe  with  a  view  to 
ensuring that he has experience equivalent to the experience normally acquired as a result of continuous 
practice  for  a  period  of  five  years  as  a  chartered accountant shall,  on  payment  of  such  fees,  as  may  be 
determined, by notification, by the Council,  8*** and on application made and granted in the prescribed 
manner, be entered in the  6[Register of members] as a fellow of the Institute and shall be entitled to use 
the letters F. C. A. after his name to indicate that he is a fellow of the Institute of Chartered Accountants. 

9* 

* 

* 

* 

*] 

6. Certificate of practice.—(1) No member of the Institute shall be entitled to practise 10[whether in 

India or elsewhere] unless he has obtained from the Council a certificate of practice: 

1. Subs. by Act 12 of 2022, s. 4, for “without India” (w.e.f. 10-5-2022). 
2. Subs. by s. 4, ibid., for “Register” (w.e.f. 10-5-2022). 
3. Subs. by Act 9 of 2006, s. 3, for sub-section (3) (w.e.f. 8-8-2006). 
4. The words “, which shall not exceed rupees three thousand” omitted by Act 12 of 2022, s. 4 (w.e.f. 10-5-2022). 
5. The Proviso omitted by s. 4, ibid. (w.e.f. 10-5-2022). 
6. Subs. by s. 5, ibid., for “Register” (w.e.f. 10-5-2022). 
7. Subs. by Act 9 of 2006, s. 4, for sub-section (3) (w.e.f. 8-8-2006).  
8. The words “which shall not exceed rupees five thousand” omitted by Act 12 of 2022, s. 5 (w.e.f. 10-5-2022). 
9. The Proviso omitted by s. 5, ibid. (w.e.f. 10-5-2022). 
10. Ins. by Act 15 of 1959, s. 5 (w.e.f. 1-7-1959).  

7 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                           
1[(2)Every such member shall pay annual fee for the certificate as may be determined, by notification, 

by the Council, and such fee shall be payable on or before the 1st day of April each year:] 

2[(3) The certificate of practice obtained under sub-section (1) may be cancelled by the Council under 

such circumstances as may be prescribed.] 

7. Members to be known as Chartered Accountants.—3[Every member of the Institute in  practice 
shall,  and  any  other  member  may,  use  the  designation  of  a  chartered  accountant  and  no  member  using 
such designation shall use any other description, whether in addition thereto or in substitution therefore]: 

Provided  that  nothing  contained  in  this  section  shall  be  deemed  to  prohibit  any  such  person  from 
adding  any  other  description  or  letters  to  his  name,  if  entitled  thereto,  to  indicate  membership  of  such 
other Institute of Accountancy, whether in India or elsewhere, as may be recognised in this behalf by the 
Council, or any other qualification that he may possess, or to prohibit a firm, all the partners of which are 
members of the Institute and in practice, from being known by its firm name as Chartered Accountants. 

8.  Disabilities.—Notwithstanding  anything  contained  in  section  4,  a  person  shall  not  be  entitled  to 

have his name entered in or borne on the 4[Register of members] if he— 

(i) has not attained the age of twenty-one years at the time of his application for the entry of his 

name in the 4[Register of members]; or 

5[(ii) is of unsound mind and stands so adjudged by a competent court; or] 

(iii) is an undischarged insolvent 6[or an undischarged bankrupt] ; or 

6[(iiia) is declared bankrupt under the Insolvency and Bankruptcy Code, 2016 (31 of 2016); or] 

(iv)  being  a  discharged  insolvent,  has  not  obtained  from  the  Court  a  certificate  stating  that  his 

insolvency was caused by misfortune without any misconduct on his part; or 

(v)  has  been  convicted  by a  competent  Court,  whether  within  or  7[outside  India],  of an  offence 
involving moral turpitude and punishable with 8*** imprisonment or of an offence, not of a technical 
nature, committed by him in his professional capacity unless in respect of the offence committed he 
has  either  been  granted  a  pardon  or,  on  an  application  made  by  him  in  this  behalf,  the  Central 
Government has, by an order in writing, removed the disability; or 

9[(vi) has been removed from membership of the Institute on being found on inquiry to have been 

guilty of professional or other misconduct: 

Provided that a person who has been removed from membership for a specified period, shall not 

be entitled to have his name entered in the 4[Register of members] until the expiry of such period.] 

CHAPTER III 

COUNCIL OF THE INSTITUTE 

9. Constitution of the Council of the Institute.—(1) There shall be a Council of the Institute for the 

management of the affairs of the Institute and for discharging the functions assigned to it under this Act. 

10[(2) The Council shall be composed of the following persons, namely:— 

1. Subs. by Act 12 of 2022, s. 6, for sub-section (2) (w.e.f. 10-5-2022).  
2. Ins. by Act 9 of 2006, s. 5 (w.e.f. 8-8-2006).  
3. Subs. by Act 15 of 1959, s. 6, for certain words (w.e.f. 1-7-1959).  
4. Subs. by Act 12 of 2022, s. 7, for “Register” (w.e.f. 10-5-2022). 
5. Subs. by Act 15 of 1959, s. 7, for clause (ii) (w.e.f. 1-7-1959).  
6. Ins. by Act 12 of 2022, s. 7 (w.e.f. 10-5-2022). 
7. Subs. by s. 7, ibid., for “without India” (w.e.f. 10-5-2022). 
8. The words “transportation or” omitted by s. 7, ibid. (w.e.f. 10-5-2022). 
9. Subs. by Act 15 of 1959, s. 7, for clause (vi) (w.e.f. 1-7-1959).  
10. Subs. by Act 9 of 2006, s. 6, for sub-section (2) (w.e.f. 5-9-2006). 

8 

                                                           
(a)  not  more  than thirty-two  persons elected  by  the  members  of  the  Institute  from  amongst  the 
fellows  of  the  Institute  chosen  in  such  manner  and  from  such  regional  constituencies  as  may  be 
specified: 

Provided  that  a  fellow  of  the  Institute,  who  has  been  found  guilty  of  any  professional  or  other 
misconduct  and  whose  name  is  removed  from  the  1[Register  of  members]  or  has  been  awarded 
penalty of fine, shall not be eligible to contest the election,— 

(i) in case of misconduct falling under the First Schedule of this Act, for a period of  2[four 

years]; 

(ii)  in  case  of  misconduct  falling  under  the  Second  Schedule  of  this  Act,  for  a  period  of 

3[eight years], 

from  the completion  of the  period of removal  of  name  from  the  1[Register  of  members]  or  payment  of 
fine, as the case may be; 

(b)  not  more  than  eight  persons  to  be  nominated  in  the  specified  manner,  by  the  Central 

Government.] 

4[(3) No person holding a post under the Central Government or a State Government shall be eligible 

for election to the Council under clause (a) of sub-section (2). 

(4) No 5[member of the Institute or any partner of a firm] who has been auditor of the Institute shall 
be eligible for election to the Council under clause (a) of sub-section (2), for a period of 6[four years] after 
he ceases to be an auditor.]  

7[9A.  Coordination  Committee.—(1)  There  shall  be  a  Coordination  Committee  consisting  of  the 
President,  Vice-President  and  the  Secretary  of  the  Council  of  each  of  the  Institutes  of  Chartered 
Accountants  of  India,  the  Cost  Accountants  of  India  and  the  Company  Secretaries  of  India  for  the 
development  and  harmonisation  of  the  professions  of  Chartered  Accountants,  Cost  Accountants  and 
Company Secretaries. 

(2)  The  meeting  of  the  Coordination  Committee  shall  be  chaired  by  the  Secretary,  Ministry  of 

Corporate Affairs. 

(3) The meeting of the Coordination Committee shall be held once in every quarter of a year. 

(4)  The  Committee  shall  be  responsible  for  the  effective  coordination  of  the  functions  assigned  to 

each Institute and shall–– 

(i) ensure quality improvement of the academics, infrastructure, research and all related works of 

the Institute; 

(ii)  focus  on  the  coordination  and  collaboration  among  the  professions,  to  make  the  profession 

more effective and robust; 

(iii) align the cross-disciplinary regulatory mechanisms for inter professional development; 

(iv) make recommendations in matters relating to regulatory policies for the professions; 

(v) perform such other functions incidental to clauses (i) to (iv) above.] 

1. Subs. by Act 12 of 2022, s. 8, for “Register” (w.e.f. 10-5-2022). 
2. Subs. by s. 8, ibid., for “three years” (w.e.f. 10-5-2022). 
3. Subs. by s. 8, ibid., for “six years” (w.e.f. 10-5-2022). 
4. Ins. by Act 9 of 2006, s. 6 (w.e.f. 5-9-2006).  
5. Subs. by Act 12 of 2022, s. 8, for “person” (w.e.f. 10-5-2022). 
6. Subs. by s. 8, ibid., for “three years” (w.e.f. 10-5-2022). 
7. Ins. by s. 9, ibid. (w.e.f. 10-5-2022). 

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1[10.  Re-election  or  re-nomination  to  Council.—2[1]  A  member  of the Council,  elected  or 
nominated under sub-section (2) of section 9, shall be eligible for re-election or, as the case may be, re-
nomination: 

Provided that no member shall hold the office for more than 3[two consecutive terms]: 

Provided  further  that  a  member  of  the  Council,  who  is  or  has  been  elected  as  President  under           

sub-section (1) of section 12, shall not be eligible for election or nomination as a member of the Council.] 

4[(2)  Notwithstanding  anything  contained  in  sub-section  (1),  a  member  of  the  Council  who 
immediately at the commencement of the Chartered Accountants, the Cost and Works Accountants and 
the  Company  Secretaries (Amendment)  Act,  2022,  has  held  office  as  such  member  for  two terms  or  is 
holding office for the second term of three years, shall be eligible to contest for one more term of four 
years and a member who has held office for one term or is holding office for the first term of three years, 
shall be eligible to contest for two more consecutive terms.] 

5[10A.  Settlement  of  dispute  regarding  election.—In  case  of  any  dispute  regarding  any  election 
under  clause  (a)  of  sub-section  (2)  of  section  9,  the  aggrieved  person  may  make  an  application  within 
thirty days from the date of declaration of the result of election to the Secretary of the Institute, who shall 
forward the same to the Central Government. 

10B. Establishment of Tribunal.—(1) On receipt of any application under section 10A, the Central 
Government  shall,  by  notification,  establish  a  Tribunal  consisting  of  a  Presiding  Officer  and  two  other 
Members to decide such dispute and the decision of such Tribunal shall be final. 

(2) A person shall not be qualified for appointment,— 

(a)  as  a  Presiding  Officer  of  the  Tribunal  unless  he  has  been  a  member  of  the  Indian  Legal 

Service and has held a post in Grade I of the service for at least three years; 

(b) as a Member unless he has been a member of the Council for at least one full term and who is 

not a sitting member of the Council or who has not been a candidate in the election under dispute; or 

(c) as a Member unless he holds the post of a Joint Secretary to the Government of India or any 
other post under the Central Government carrying a scale of pay which is not less than that of a Joint 
Secretary to the Government of India. 

(3) The terms and conditions of service of the Presiding Officer and Members of the Tribunal, their 

place of meetings and allowances shall be such as may be specified. 

(4) The expenses of the Tribunal shall be borne by the Council.] 

11.  Nomination  in  default  of  election  or  nomination.—If  any  body  of  persons  referred  to  in              

section 9 fails to elect any of the members of the Council which it is empowered under that section to 
elect, the Central Government may nominate a person duly qualified to fill the vacancy, and any person 
so nominated shall be deemed to be a member of the Council as if he had been duly elected. 

12.  President  and  Vice-President.—(1)  The  Council  at  its  first  meeting  shall  elect  two  of  its 
members  to  be  respectively  the  President  and  Vice  President  thereof,  and  so  often  as  the  office  of  the 
President  or  the  Vice-President  becomes  vacant  the  Council  shall  choose  another  person  to  be  the 
President or the Vice-President as the case may be: 

6* 

* 

* 

* 

* 

(2) The President shall be the 7[Head] of the Council. 

1. Subs. by Act 9 of 2006,  s. 7, for section 10 (w.e.f. 8-8-2006).  
2. Section 10 shall be renumbered as sub-section (1) by Act 12 of 2022, s. 10 (w.e.f. 10-5-2022). 
3. Subs. by s. 10, ibid., for “three consecutive terms” (w.e.f. 10-5-2022). 
4. Ins. by s. 10, ibid. (w.e.f. 10-5-2022). 
5. Ins. by Act 9 of 2006, s. 8 (w.e.f. 17-11-2006).  
6. The Proviso omitted by Act 12 of 2022, s. 11 (w.e.f. 10-5-2022). 
7. Subs. by s. 11, ibid., for “Chief Executive Authority” (w.e.f.10-5-2022). 

10 

 
 
 
 
 
 
 
 
 
                                                           
1[(2A) The President shall preside at the meetings of the Council. 

(2B)  The  President  and  the  Vice-resident  shall  exercise  such  powers  and  perform  such  duties  and 

functions as may be prescribed. 

(2C)  It  shall  be  the  duty  of  the  President  to  ensure  that  the  decisions  taken  by  the  Council  are 

implemented. 

(2D) If, for any reason a vacancy occurs in the office of the President, or if the President is absent or 
for  any  other  reason, is  unable  to  exercise the  powers  or  perform  the  duties assigned  to  him,  the Vice-
President shall act in his place and exercise the powers and perform the duties of the President.] 

(3) The  President  or the Vice-President shall hold office for a  period  of  one  year  from  the  date  on 
which he is chosen but so as not to extend beyond his term of office as, a member of the Council, and, 
subject  to  his  being  a  member  of  the  Council  at  the  relevant  time,  he  shall  be  eligible  for  re-election 
2[under sub-section (1)]. 

(4)  3[On the expiration of the duration of the Council, the  4[President and the Vice-President] of the 
Council at the time of such expiration] shall continue to hold office and discharge such administrative and 
other duties as may be prescribed until such time as a new 3[President and the Vice-President] shall have 
been elected and shall have taken over 5[charge of their duties]. 

13. Resignation of membership and casual vacancies.—(1) Any member of the Council may at any 
time  resign  his  membership  by  writing  under  his  hand  addressed  to the  President,  and the seat  of such 
member shall become vacant when such resignation is notified in the Official Gazette. 

(2) A member of the Council shall be deemed to have vacated his seat if he is declared by the Council 
to have been absent without sufficient excuse from three consecutive meetings of the Council, 6[or he has 
been found guilty of any professional or other misconduct and awarded penalty of fine,] or if his name is, 
for any cause, removed from the 7[Register of members] under the provisions of section 20. 

(3) A casual vacancy in the Council shall be filled by fresh election from the constituency concerned 
or by nomination by the Central Government, as the case may be, and the person elected or nominated to 
fill the vacancy shall hold office until the dissolution of the Council: 

8[Provided that no election shall be held to fill a casual vacancy occurring within 9[one year] prior to 
the date of the expiration of the duration of the Council, but such a vacancy may be filled by nomination 
by the Central Government after consultation with the President of the Council.] 

(4) No act done by the Council shall be called in question on the ground merely of the existence of 

any vacancy in, or defect in the constitution of, the Council. 

14.  Duration  and  dissolution  of  Council.—10[(1)]  The  duration  of  any  Council  constituted  under 
this  Act  shall  be  11[four  years]  from  the  date  of  its  first  meeting,  on  the  expiry  of  which  it  shall  stand 
dissolved and a new Council constituted in accordance with the provisions of this Act. 

12[(2)  Notwithstanding  the  expiration  of  the  duration  of  a  Council  (hereinafter  referred  to  as  the 
former  Council),  the  former  Council  shall  continue  to  exercise  its  functions  until  a  new  Council  is 

1. Ins. by Act 12 of 2022, s. 11 (w.e.f. 10-5-2022). 
2. Ins. by Act 9 of 2006, s. 9 (w.e.f. 8-8-2006).  
3. Subs. by Act 15 of 1959, s. 10, for “On the Dissolution of the Council, the President of the Council at the time of such 

dissolution (w.e.f. 1-7-1959).  

4. Subs. by Act 9 of 2006, s. 9, for “President” (w.e.f. 8-8-2006).  
5. Subs. by s. 9, ibid., for “charge of his duties” (w.e.f. 8-8-2006).  
6. Ins. by s. 10, ibid. (w.e.f. 17-11-2006).  
7. Subs. by Act 12 of 2022, s. 12, for “Register” (w.e.f. 10-5-2022). 
8. Added by Act 15 of 1959, s. 11 (w.e.f. 1-7-1959).  
9. Subs. by Act 9 of 2006, s. 10, for “six months” (w.e.f. 17-11-2006).  
10. Section 14 re-numbered as sub-section (1) thereof by Act 15 of 1959, s. 12 (w.e.f. 1-7-1959).  
11. Subs. by Act 12 of 2022, s. 13, for “three years” (w.e.f. 10-5-2022). 
12. Ins. by Act 15 of 1959,  s. 12 (w.e.f. 1-7-1959).  

11 

                                                           
constituted  in  accordance with the  provisions of this  Act,  and  on such constitution,  the  former  Council 
shall stand dissolved.] 

1[15. Functions of Council.—(1) The Institute shall function under the overall control, guidance and 
supervision of the Council and the duty of carrying out the provisions of this Act shall be vested in the 
Council. 

(2)  In  particular,  and  without  prejudice  to  the  generality  of  the  foregoing  powers,  the  duties  of  the 

Council shall include— 

(a) to approve academic courses and their contents; 

2[(b) the prescribing of fees for the examination of candidates for enrolment; 

(c) the granting or refusal, of registration of a firm;] 

(d) the prescribing of qualifications for entry in the 3[Register of members]; 

(e) the recognition of foreign qualifications and training for the purposes of enrolment; 

4[(f) the prescribing of guidelines for grant or refusal of certificates of practice under this Act; 

(fa) to issue guidelines for the purpose of carrying out the objects of this Act;] 

5* 

* 

* 

* 

* 

(h) the levy 6*** of fees from members, examinees and other persons; 

7* 

* 

* 

** 

 (j)  the  regulation  and  maintenance  of  the  status  and  standard  of  professional  qualifications  of 

members of the Institute; 

(k)  the  carrying  out,  by  granting  financial  assistance  to  persons  other  than  members  of  the 

Council or in any other manner, of research in accountancy; 

8[(l) to conduct investor education and awareness programmes; 

(la)  to  enter  into  any  memorandum  or  arrangement  with  the  prior  approval  of  the  Central 
Government, with any agency of a foreign country, for the purpose of performing its functions under 
this Act;] 

(m) to enable functioning of the Director (Discipline), the  Board of Discipline, the Disciplinary 

Committee and the Appellate Authority constituted under the provisions of this Act; 

(n) to enable functioning of the Quality Review Board; 

(o) consideration of the recommendations of the Quality Review Board made under clause (a) of 

section 28B and the details of action taken thereon in its annual report; and 

(p) to ensure the functioning of the Institute in accordance with the provisions of this Act and in 

performance of other statutory duties as may be entrusted to the Institute from time to time.] 

9[15A.  Imparting  education  by  Universities  and  other  bodies.—(1)  Subject  to  the  provisions  of 
this Act, any University established by law or any body affiliated to the Institute, may impart education 
on the subjects covered by the academic courses of the Institute. 

1. Subs. by Act 9 of 2006, s. 11, for section 15 (w.e.f. 17-11-2006).  
2. Subs. by Act 12 of 2022, s. 14, for clauses (b) and (c) (w.e.f. 10-5-2022). 
3. Subs. by s. 14, ibid., for “Register” (w.e.f. 10-5-2022). 
4. Subs. by s. 14, ibid., for clause (f) (w.e.f. 10-5-2022). 
5. Clause (g) omitted by s. 14, ibid. (w.e.f. 10-5-2022). 
6.  The words “and collection” omitted by s. 14, ibid. (w.e.f. 10-5-2022). 
7. Clause (i) omitted by s. 14, ibid. (w.e.f. 10-5-2022). 
8. Subs. by s. 14, ibid., for clause (l) (w.e.f. 10-5-2022). 
9. Ins. by Act 9 of 2006, s. 12 (w.e.f. 8-8-2006).  

12 

 
 
 
 
 
 
 
 
 
 
 
 
 
                                                           
(2) The Universities or bodies referred to in sub-section (1) shall, while awarding degree, diploma or 
certificate or bestowing any designation, ensure that the award or designation do not resemble or is not 
identical to one awarded by the Institute. 

(3)  Nothing  contained  in  this  section  shall  enable  a  University  or  a  body  to  adopt  a  name  or 

nomenclature which is in any way similar to that of the Institute.] 

1[15B. Functions of Institute.—The functions of the Institute shall include–– 

(a) the examination of candidates for enrolment; 

(b) the regulation of the engagement and training of articled and audit assistants; 

(c)  the  maintenance  and  publication  of  a  Register  of  persons  qualified  to  practice  as  chartered 

accountants; 

(d) the maintenance and publication of Register of firms; 

(e) collection of fees from members, examinees and other persons; 

(f) subject to the orders of the appropriate authorities under this Act, the removal of names from 
the Register of members and firms and the restoration of names to the Register of members and firms 
which have been removed; 

(g) the maintenance of a library and publication of books and periodicals relating to accountancy 

and allied subjects; 

(h) the conduct of elections to the Council of the Institute; and 

(i) the granting or refusal of certificates of practice as per guidelines issued by the Council.] 

2[16.  Officers  and  employees,  salary,  allowances,  etc.—(1)  For  the  efficient  performance  of  its 

duties, the Council shall— 

(a) appoint a Secretary to perform such duties as may be prescribed; 

(b)  appoint  a  Director  (Discipline)  to  perform  such  functions  as  are  assigned  to  him  under  this 

Act and the rules and regulations framed thereunder. 

(2) The Council may also— 

(a) appoint such other officers and employees as it considers necessary; 

(b) require and take from the Secretary or from any other officer or employee such security for 

the due performance of his duties, as the Council considers necessary; 

3[(c) prescribe the manner of appointment, powers, duties and functions of the Secretary and other 

officers and employees, their salaries, fees, allowances and other terms and conditions of service;] 

(d)  with  the  previous  sanction  of  the  Central  Government,  fix  the  allowances  of  the  President, 

Vice-President and other members of the Council and members of its Committees. 

(3)  The  Secretary  of  the  Council  shall  be  entitled  to  participate  in  the  meetings  of  the  Council  but 

shall not be entitled to vote thereat.] 

17.  Committees  of  the  Council.—(1)  The  Council  shall  constitute  from  amongst  its  members  the 

following Standing Committees, namely:— 

(i) an Executive Committee, 

(ii) an Examination Committee, and 

4[(iii) a Finance Committee.] 

1. Ins. by Act 12 of 2022, s. 15 (w.e.f. 10-5-2022). 
2. Subs. by Act 9 of 2006, s. 13,  for section 16 (w.e.f. 17-11-2006).  
3. Subs. by Act 12 of 2022, s. 16, for clause (c) (w.e.f. 10-5-2022). 
4. Subs. by Act 9 of 2006, s. 14, for clause (iii) (w.e.f. 17-11-2006).  

13 

                                                           
1[(2)  The  Council  may  also  form  such  other  committees  from  amongst  its  members  as  it  consider 
necessary for the purpose of carrying out the provisions of this Act, and any Committee so formed may, 
with the sanction of the Council, co-opt such other members of the Institute not exceeding one-third of 
the members of the committee as it thinks fit, and any member so co-opted shall be entitled to exercise all 
the rights of a member of the committee. 

(3) Each of the Standing Committees shall consist of the President and the Vice-President ex officio, 
and  minimum  of  three  and  maximum  of  five  members  to  be  elected  by  the  Council  from  amongst  its 
members.] 

(4) The  President  and the Vice-President of the  Council  shall  be the  Chairman  and Vice-Chairman 

respectively of each of the Standing Committees. 

(5) Every member of the Standing Committee other than the Chairman and the Vice-Chairman shall 
hold office for one year from the date of his election, but subject to being a member of the Council, he 
shall be eligible for re-election. 

(6) The Standing Committees shall exercise such functions and be subject to such conditions in the 

exercise thereof as may be prescribed. 

18.  Finances  of  the  Council.—(1)  There  shall  be  established  a  fund  under  the  management  and 
control of the Council into which shall be paid all monies received by the Council and out of which shall 
be met all expenses and liabilities properly incurred by the Council. 

(2) The Council may invest any money for the time being standing to the credit of the fund in any 

Government security or in any other security approved by the Central Government. 

2[(3) The Council shall keep proper accounts of the fund distinguishing capital from revenue in the 

manner prescribed. 

(4) The Council shall prepare in the manner prescribed and approve, prior to the start of the financial 
year,  an  annual  financial  statement  (the  budget)  indicating  all  its  anticipated  revenues  as  well  as  all 
proposed expenditures for the forthcoming year. 

3[(5) The annual accounts of the Council shall be prepared in such manner as may be prescribed and 
subject to audit by a firm of chartered accountants to be appointed annually by the Council from the panel 
of auditors maintained by the Comptroller and Auditor-General of India: 

Provided that a firm shall not be eligible for appointment as an auditor under this sub-section, if any 

of its partner is or has been a member of the Council during the last four years: 

Provided further that in the event it is brought to the notice of the Council that the accounts of the 
Council do not represent a true and fair view of its finances, then, the Council may itself cause a special 
audit to be conducted: 

Provided also that, if such information, that the accounts of the Council do not represent a true and 
fair  view  of  its  finances,  is  sent  to  the  Council  by  the  Central  Government,  then,  the  Council  may, 
wherever appropriate cause a special audit or take such other action as it considers necessary and shall 
furnish an action taken report thereon to the Central Government.] 

4[(5A) As soon as may be practicable at the end of each year, the Council shall circulate the audited 
accounts  to  its  members  at  least  fifteen  days  in  advance  and  consider  and  approve  these  accounts  in  a 
special meeting convened for the purpose. 

(5B) The Council shall cause to be published in the Gazette of India not later than the 30th day of 
September of the year next following, a copy of the audited accounts and the Report of the Council for 
that year duly approved by the Council and copies of the said accounts and Report shall be forwarded to 
the Central Government and to all the members of the Institute.] 

1. Subs. by Act 9 of 2006, s. 14, for sub-sections (2) and (3) (w.e.f. 17-11-2006).  
2. Subs. by s. 15, ibid.,  for sub-sections (3), (4) and (5) (w.e.f. 17-11-2006).  
3. Subs. by Act 12 of 2022, s. 17, for sub-section (5) (w.e.f. 10-5-2022). 
4. Ins. by Act 9 of 2006,  s. 15 (w.e.f. 17-11-2006).  

14 

                                                           
(6)  The  Council  may  borrow  from  a  scheduled  bank,  as  defined  in  the  Reserve  Bank  of  India                   

Act, 1934 (2 of 1934), or from the Central Government— 

(a) any money required for meeting its liabilities on capital account on the security of the fund or 

on the security of any other assets for the time being belonging to it, or 

(b)  for  the  purpose  of  meeting  current  liabilities  pending  the  receipt  of  income  by  way  of 

temporary loan or overdraft. 

CHAPTER IV 

REGISTER OF MEMBERS 

19. 1[Register of members].—2[(1) The Council shall maintain a Register of members of the Institute 

in such manner as may be prescribed.] 

(2)  The  1[Register  of  members]  shall  include  the  following  particulars  about  every  member  of  the 

Institute, namely,— 

(a) his full name, date of birth domicile, residential and professional addresses; 
(b) the date on which his name is entered in the 1[Register of members]; 

(c) his qualifications; 
3[(ca)  whether  any  actionable  information  or  complaint  is  pending  or  any  penalty  has  been 

imposed against him under Chapter V, including details thereof, if any;] 

(d) whether he holds a certificate of practice; and 

(e) any other particulars which may be prescribed. 

4[(3) The council shall cause to be published in such manner as may be prescribed, a list of members 
of  the  Institute  as  on  the  1st  day  of  April  of  each  year,  and  shall,  if  requested  to  do  so  by  any  such 
member, send to him a copy of such list 5[on payment of such amount as may be prescribed].] 

6[(4) Every member of the Institute shall, on his name being entered in the  1[Register of members], 

pay such annual membership fee as may be determined, by notification, by the Council 7***. 

8* 

* 

* 

* 

*] 

9[20.  Removal  from  the  10[Register  of  members].—(1)  The  Council  may  remove  from  the 

10[Register of members] the name of any member of the Institute 

(a) who is dead; or 

(b) from whom a request has been received to that effect, or 

(c) who has not paid any prescribed fee required to be paid by him; or 
(d) who is found to have been subject at the time when his name was entered in the 10[Register of 
members], or who at any time thereafter has become subject, to any of the disabilities mentioned in 
section  8,  or  who  for  any  other  reason  has  ceased  to  be  entitled  to  have  his  name  borne  on  the 
Register. 

(2) The Council shall remove from the Register the name of any member in respect of whom an order 

has been passed under this Act removing him from membership of the Institute.] 

1. Subs. by Act 12 of 2022, s. 18, for “Register” (w.e.f. 10-5-2022). 
2. Subs. by s. 18, ibid., for sub-section (1)  (w.e.f. 10-5-2022). 
3. Ins. by s.18, ibid. (w.e.f. 10-5-2022). 
4. Subs. by Act 15 of 1959, s. 17, for sub-section (3) (w.e.f. 1-7-1959).  
5. Ins. by Act 9 of 2006, s. 16 (w.e.f. 17-11-2006).  
6. Subs. by Act 9 of 2006, s. 16, for sub-section (4) (w.e.f. 8-8-2006). 
7. The words “, which shall not exceed  rupees five thousand” omitted by Act 12 of 2022, s. 18 (w.e.f. 10-5-2022). 
8. The Proviso omitted by s. 18, ibid. (w.e.f. 10-5-2022). 
9. Subs. by Act 15 of 1959, s. 18, for section 20 (w.e.f. 1-7-1959).  
10. Subs. by Act 12 of 2022, s. 19, for “Register” (w.e.f. 10-5-2022). 

15 

 
 
 
 
 
 
 
 
                                                           
1[(3)  If  the  name  of  any  member  has  been  removed  from  the  Register  under  clause  (c)  of                         

sub-section (1), on receipt of an application, his name may be entered again in the Register on payment of 
the  arrears  of  annual  fee  and  entrance  fee  along  with  such  additional  fee,  as  may  be  determined,  by 
notification, by the Council 2***: 

3* 

* 

* 

* 

* 

4[CHAPTER V 

MISCONDUCT 

5[21.  Disciplinary  Directorate.—(1)  The  Council  shall,  by  notification,  establish  a  Disciplinary 
Directorate  headed  by  an  officer  of  the  Institute  designated  as  Director  (Discipline)  and  such  other 
employees for making investigations in respect of any information or complaint received by it. 

(2) On receipt of any information or complaint along with the prescribed fee, the Director (Discipline) 

shall arrive at a prima facie opinion on the occurrence of the alleged misconduct. 

(3) Where the Director (Discipline) is of the opinion that a member is guilty of any professional or 
other misconduct mentioned in the First Schedule, he shall place the matter before the Board of Discipline 
and where the Director (Discipline) is of the opinion that a member is guilty of any professional or other 
misconduct mentioned in the Second Schedule or in both the Schedules, he shall place the matter before 
the Disciplinary Committee. 

(4) In order to make investigations under the provisions of this Act, the Disciplinary Directorate shall 

follow such procedure as may be specified. 

(5)  Where  a  complainant  withdraws  the  complaint,  the  Director  (Discipline)  shall  place  such 
withdrawal before the Board of Discipline or, as the case may be, the Disciplinary Committee, and the 
said  Board  or  Committee  may,  if  it  is  of  the  view  that  the  circumstances  so  warrant,  permit  the 
withdrawal at any stage.] 

6[21A. Board of Discipline.—(1) The Council shall constitute a Board of Discipline consisting of— 

(a)  a  person  with  experience  in  law  and  having  knowledge  of  disciplinary  matters  and  the 

profession, to be its presiding officer; 

(b) two members one of whom shall be a member of the Council elected by the Council and the 
other member shall be nominated by the Central Government from amongst the persons of eminence 
having experience in the field of law, economics, business, finance or accountancy; 

(c) the Director (Discipline) shall function as the Secretary of the Board. 

(2) The Board of Discipline shall follow summary disposal procedure in dealing with all cases before 

it. 

(3) Where the Board of Discipline is of the opinion that a member is guilty of a professional or other 
misconduct mentioned in the First Schedule, it shall afford to the member an opportunity of being heard 
before making any order against him and may thereafter take any one or more of the following actions, 
namely:— 

(a) reprimand the member; 

(b) remove the name of the member from the Register up to a period of three months; 

(c) impose such fine as it may think fit, which may extend to rupees one lakh. 

1. Ins. by Act 9 of 2006, s. 17 (w.e.f. 8-8-2006).  
2. The words “, which shall not exceed rupees two thousand” omitted by Act 12 of 2022, s. 19 (w.e.f. 10-5-2022) 
3. The Proviso omitted by s. 19, ibid. (w.e.f. 10-5-2022). 
4.  Subs. by Act 15 of 1959, s. 19, for CHAPTER V (w.e.f. 1-7-1959). 
5. Subs. by Act 9 of 2006, s. 18, for section 21 (w.e.f. 17-11-2006).  
6. Ins. by Act 9 of 2006, s. 19 (w.e.f. 17-11-2006).  

16 

 
 
 
 
 
 
 
                                                           
(4)  The  Director  (Discipline)  shall  submit  before  the  Board  of  Discipline  all  information  and 
complaints where he is of the opinion that there is no prima facie case and the Board of Discipline may, if 
it agrees with the opinion of the Director (Discipline), close the matter or in case of disagreement, may 
advise the Director (Discipline) to further investigate the matter. 

21B.  Disciplinary  Committee.—(1)  The  Council  shall  constitute  a  Disciplinary  Committee 
consisting of the President or the Vice-President of the Council as the Presiding Officer and two members 
to be elected from amongst the members of the Council and two members to be nominated by the Central 
Government  from  amongst  the  persons  of  eminence  having  experience  in  the  field  of  law,  economics, 
business, finance or accountancy: 

Provided  that  the  Council  may  constitute  more  Disciplinary  Committees  as  and  when  it  considers 

necessary. 

(2)  The  Disciplinary  Committee,  while  considering  the  cases  placed  before  it  shall  follow  such 

procedure as may be specified. 

(3) Where the Disciplinary Committee is of the opinion that a member is guilty of a professional or 
other misconduct mentioned in the Second Schedule or both the First Schedule and the Second Schedule, 
it shall afford to the member an opportunity of being heard before making any order against him and may 
thereafter take any one or more of the following actions, namely:— 

(a) reprimand the member; 

(b) remove the name of the member from the Register permanently or for such period, as it thinks 

fit; 

(c) impose such fine as it may think fit, which may extend to rupees five lakhs. 

(4) The allowances payable to the members nominated by the Central Government shall be such as 

may be specified. 

21C. Authority, Disciplinary Committee, Board of Discipline and Director (Discipline) to have 
powers of civil court.—For the purposes of an inquiry under the provisions of this Act, the Authority, the 
Disciplinary Committee, Board of Discipline and the Director (Discipline) shall have the same powers as 
are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following 
matters, namely:— 

(a) summoning and enforcing the attendance of any person and examining him on oath; 

(b) the discovery and production of any document; and 

(c) receiving evidence on affidavit. 

1* 

* 

* 

* 

*. 

21D. Transitional provisions.—All complaints pending before the Council or any inquiry initiated 
by  the  Disciplinary  Committee  or  any  reference  or  appeal  made  to  a  High  Court  prior  to  the 
commencement of the Chartered Accountants (Amendment) Act, 2006 (9 of 2006), shall continue to be 
governed by the provisions of this Act, as if this Act had not been amended by the Chartered Accountants 
(Amendment) Act, 2006.] 

2[22.  Professional  or  other  misconduct  defined.—For  the  purposes  of  this  Act,  the  expression 
“professional or other misconduct” shall be deemed to include any act or omission provided in any of the 
Schedules,  but  nothing  in  this  section  shall  be  construed  to  limit  or  abridge  in  any  way  the  power 
conferred or duty cast on the Director (Discipline) under sub-section (1) of section 21 to inquire into the 
conduct of any member of the Institute under any other circumstances.] 

1. The Explanation omitted by Act 12 of 2022, s. 24 (w.e.f. 10-5-2022). 
2. Subs. by Act 9 of 2006, s. 20, for section 22 (w.e.f. 17-11-2006).  

17 

 
 
 
 
 
 
 
                                                           
1[22A.  Constitution  of  Appellate  Authority.—(1)  The  Central  Government  shall,  by  notification, 

constitute an Appellate Authority consisting of— 

(a) a person who is or has been a judge of a High Court, to be its Chairperson; 

(b)  two  members  to  be  appointed  from  amongst  the  persons  who  have  been  members  of  the 

Council for at least one full term and who is not a sitting member of the Council; 

(c)  two  members  to  be  nominated  by  the  Central  Government  from  amongst  persons  having 
knowledge and practical experience in the field of law, economics, business, finance or accountancy. 

(2) The Chairperson and other members shall be part-time members. 

22B. Term of office of Chairperson and members of Authority.—(1) A person appointed as the 
Chairperson shall hold office for a term of three years from the date on which he enters upon his office or 
until he attains the age of sixty-five years, whichever is earlier. 

(2) A person appointed as a member shall hold office for a term of three years from the date on which 

he enters upon his office or until he attains the age of sixty-two years, whichever is earlier. 

22C.  Allowances  and  conditions  of  service  of  Chairperson  and  members  of  Authority.—The 
allowances payable to, and other terms and conditions of service of, the Chairperson and members and 
the  manner  of  meeting  expenditure  of  the  Authority  by  the  Council  and  such  other  authorities  shall  be 
such as may be specified. 

22D. Procedure to be regulated by Authority.—(1) The office of the Authority shall be at Delhi. 

(2) The Authority shall regulate its own procedure. 

(3) All orders and decisions of the Authority shall be authenticated by an officer duly authorised by 

the Chairperson in this behalf. 

22E. Officers and other staff of Authority.—(1) The Council shall make available to the Authority 
such officers and other staff members as may be necessary for the efficient performance of the functions 
of the Authority. 

(2) The salaries and allowances and conditions of service of the officers and other staff members of 

the Authority shall be such as may be prescribed. 

22F. Resignation and removal of Chairperson and members.—(1) The Chairperson or a member 

may, by notice in writing under his hand addressed to the Central Government, resign his office: 

Provided that the Chairperson or a member shall, unless he is permitted by the Central Government to 
relinquish  his  office  sooner,  continue  to  hold  office  until  the  expiry  of  three  months  from  the  date  of 
receipt of such notice or until a person duly appointed as his successor enters upon his office or until the 
expiry of term of office, whichever is earlier. 

(2)  The  Chairperson  or  a  member  shall  not  be  removed  from  his  office  except  by  an  order  of  the 
Central Government on the ground of proved misbehaviour or incapacity after an inquiry made by such 
person as the Central Government may appoint for this purpose in which the Chairperson or a member 
concerned  has  been  informed  of  the  charges  against  him  and  given  a  reasonable  opportunity  of  being 
heard in respect of such charges. 

22G. Appeal to Authority.—(1) Any member of the Institute aggrieved by any order of the Board of 
Discipline or the Disciplinary Committee imposing on him any of the penalties referred to in sub-section 
(3) of section 21A and sub-section (3) of section 21B, may within ninety days from the date on which the 
order is communicated to him, prefer an appeal to the Authority: 

1. Subs. by Act 9 of 2006, s. 21, for section 22A (w.e.f. 17-11-2006). 

18 

                                                           
Provided  that  the  Director  (Discipline)  may  also  appeal  against  the  decision  of  the  Board  of 
Discipline or the Disciplinary Committee to the Authority, if so authorised by the Council, within ninety 
days: 

Provided further that the Authority may entertain any such appeal after the expiry of the said period 

of ninety days, if it is satisfied that there was sufficient cause for not filing the appeal in time. 

(2) The Authority may, after calling for the records of any case, revise any order made by the Board 
of Discipline or the Disciplinary Committee under sub-section (3) of section 21A and sub-section (3) of 
section 21B and may— 

(a) confirm, modify or set aside the order; 

(b) impose any penalty or set aside, reduce, or enhance the penalty imposed by the order; 

(c) remit the case to the Board of Discipline or Disciplinary Committee for such further enquiry 

as the Authority considers proper in the circumstances of the case; or 

(d) pass such other order as the Authority thinks fit: 

Provided that the Authority shall give an opportunity of being heard to the parties concerned before 

passing any order.] 

CHAPTER VI 

REGIONAL COUNCILS 

23.  Constitution  and  functions  of  Regional  Councils.—(1)  1[For  the  purpose  of  advising  and 
assisting  it  on  matters  concerning  its functions,  the Council  may  constitute  such  Regional  Councils]  as 
and when it deems fit for one or more of the regional constituencies that may be specified by the Central 
Government under clause (a) of sub-section (2) of section 9. 

(2) The Regional Councils shall be constituted in such manner and exercise such functions as may be 

prescribed. 

CHAPTER VII 

PENALTIES 

24. Penalty for falsely claiming to be a member, etc.—Any person who,— 

(i) not being a member of the Institute,— 

(a) represents that he is a member of the Institute; or 

(b) uses the designation Chartered Accountant, or 

(ii) being a member of the Institute, but not having a certificate of practice, represents that he is in 

practice or practices as a chartered accountants, 

shall  be  punishable  on  first  conviction  with  fine  which  may  extend  to  2[one  lakh  rupees],  and  on  any 
subsequent conviction with imprisonment which may extend to six months or with fine which may extend 
to 3[five lakh rupees], or with both. 

4[24A.  Penalty  for  using  name  of  the  Council,  awarding  degrees  of  chartered  accountancy, 

etc.—(1) Save as otherwise provided in this Act, no person shall— 

(i)  use  a  name  or  a  common  seal  which  is  identical  with  the  name  or  the  common  seal  of  the 

Institute or so nearly resembles it as to deceive or as is likely to deceive the public; 

1. Subs. by Act 15 of 1959, s. 20, for “The Council may constitute such Regional Councils” (w.e.f. 1-7-1959).  
2. Subs. by  Act 12 of 2022, s. 28, for “one thousand rupees” (w.e.f. 10-5-2022). 
3. Subs. by s. 28, ibid., for “five thousand rupees” (w.e.f. 10-5-2022). 
4. Ins. by Act 15 of 1959, s. 21 (w.e.f. 1-7-1959). 

19 

                                                           
(ii)  award  any  degree,  diploma  or  certificate  or  bestow  any  designation  which  indicates  or 
purports to indicate the position or attainment of any qualification or competence similar to that of a 
member of the Institute; or 

(iii) seek to regulate in any manner whatsoever the profession of chartered accountants. 

(2)  Any  person  contravening  the  provisions  of sub-section (1)  shall,  without  prejudice  to  any  other 
proceedings which may be taken against him, 1[be punishable with imprisonment which may extend to six 
months,  or  with  fine  which  shall  not  be  less  than  one  lakh  rupees  but  which  may  extend    to  five  lakh 
rupees, or with both on first conviction] and on any subsequent conviction with imprisonment which may 
extend to 2[one year, or with fine which shall not be less than two lakh rupees but which may extend to 
ten lakh rupees], or with both. 

3* 
25. Companies not to engage in accountancy.—(1) No company, whether incorporated in India or 

*] 

* 

* 

* 

elsewhere, shall practice as chartered accountants. 

4[Explanation.—For the removal of doubts, it is hereby declared that the “company” shall include any 

limited liability partnership which has company as its partner for the purposes of this section.] 

(2) If any company contravenes the provisions of sub-section (1), then, without prejudice to any other 
proceedings which may be taken against the company, every director, manager, secretary and any other 
officer thereof who is knowingly a party to such contravention shall be punishable with fine 5[which shall 
not be less than two lakh rupees but] which may extend on first conviction to  6[ten lakh rupees], and on 
any subsequent conviction 7[with fine which shall not be less than four lakh rupees but which may extend 
to twenty lakh rupees]. 

26.  Unqualified  persons  not  to  sign  documents.—(1)  No  person  other  than  a  member  of  the 
Institute  shall  sign  any  document  on  behalf  of  a  8[chartered  accountant  in  practice]  or  a  9[firm  of  such 
chartered accountants] in his or its professional capacity. 

10[(2) Any person who contravenes the provisions of sub-section (1) shall, without prejudice to any 
other proceedings, which may be taken against him, be punishable on first conviction with a fine not less 
than  11[one  lakh  rupees]  but  which  may  extend  to  12[five  lakh  rupees],  and  in  the event  of  a  second  or 
subsequent conviction with imprisonment for a term which may extend to one year or with fine not less 
13[two lakh rupees] but which may extend to 14[ten lakh rupees] or with both.] 

27. Maintenance of branch offices.—(1) Where a 15[chartered accountant in practice] or a 16[firm of 
such  chartered  accountants]  has  more than  one  office  in  India,  each  one of  such  offices  shall  be in the 
separate charge of a member of the Institute: 

Provided that the Council may in suitable cases exempt any  2[chartered accountant in practice] or a 

3[firm of such chartered accountants] from the operation of this sub-section. 

(2) Every  2[chartered accountant in practice] or a  3[firm of such chartered accountants]  maintaining 
more than one office shall send to the Council a list of offices and the persons in charge thereof and shall 
keep the Council informed of any changes in relation thereto. 

1. Subs. by Act 12 of 2022, s. 29, for “be punishable with fine which may extend on first conviction to one thousand rupees” 
(w.e.f. 10-5-2022). 
2. Subs. by s. 29, ibid., for “six months, or with fine which may extend to five thousand rupees” (w.e.f.10-5-2022). 
3. Omitted by Act 9 of 2006, s. 22 (w.e.f. 8-8-2006).  
4. Ins. by Act 3 of 2012, s. 3 (w.e.f. 1-2-2012).  
5. Ins. by Act 12 of 2022, s. 30 (w.e.f. 10-5-2022). 
6. Subs. by s. 30, ibid., for “one thousand rupees” (w.e.f. 10-5-2022). 
7. Subs. by s. 30, ibid., for “to five thousand rupees” (w.e.f. 10-5-2022). 
8. Subs. by Act 15 of 1959, s. 22, for “chartered accountant” (w.e.f. 1-7-1959). 
9. Subs. by s. 22, ibid., for “firm of chartered accountants” (w.e.f. 1-7-1959). 
10. Subs. by Act 9 of 2006, s. 23, for sub-section (2) (w.e.f. 8-8-2006).  
11. Subs. by Act 12 of 2022, s. 31, for “five thousand rupees” (w.e.f. 10-5-2022). 
12. Subs. by s. 31, ibid., for “one lakh rupees” (w.e.f. 10-5-2022). 
13. Subs. by s. 31, ibid., for “ten thousand rupees” (w.e.f. 10-5-2022). 
14. Subs. by s. 31, ibid., for “two lakh rupees” (w.e.f. 10-5-2022). 
15. Subs. by Act 15 of 1959, s. 22, for “chartered accountant” (w.e.f. 1-7-1959). 
16. Subs. by s. 22, ibid., for “firm of chartered accountants” (w.e.f. 1-7-1959). 

20 

 
 
 
 
 
 
 
 
                                                           
28.  Sanction  to  prosecute.—No  person  shall  be  prosecuted  under  this  Act  except  on  a  complaint 

made by or under the order of the Council or of the Central Government. 

1[CHAPTER VII A 

QUALITY REVIEW BOARD 

28A. Establishment of Quality Review Board.—(1) The Central Government shall, by notification, 

constitute a Quality Review Board consisting of a Chairperson and ten other members. 

(2)  The  Chairperson  and  members  of  the  Board  shall  be  appointed  from  amongst  the  persons  of 

eminence having experience in the field of law, economics, business, finance or accountancy. 

(3) Five members of the Board shall be nominated by the Council and other five members shall be 

nominated by the Central Government. 

28B. Functions of Board.—The Board shall perform the following functions, namely:— 

(a) to make recommendations to the Council with regard to the quality of services provided by 

the members of the Institute; 

(b)  to  review  the  quality  of  services  provided  by  the  members  of  the  Institute  including  audit 

services; and 

(c) to guide the members of the Institute to improve the quality of services and adherence to the 

various statutory and other regulatory requirements. 

2[(d) to forward cases of non-compliance with various statutory and regulatory requirements by 
the  members  of  the  Institute  or  firms,  noticed  by  it  during  the  course  of  its  reviews,  to  the 
Disciplinary Directorate for its examination.] 

28C. Procedure of Board.—The Board shall meet at such time and place and follow in its meetings 

such procedure as may be specified. 

28D.  Terms  and  conditions  of  services  of  Chairperson  and  members  of  Board  and  its 
expenditure.—(1) The terms and conditions of service of the Chairperson and the members of the Board, 
and their allowances shall be such as may be specified. 

(2) The expenditure of the Board shall be borne by the Council.] 

CHAPTER VIII 

MISCELLANEOUS 

29.  Reciprocity.—(1)  Where  any  country,  specified  by  the  Central  Government  in  this  behalf  by 
notification in the official Gazette, prevents persons of Indian domicile from becoming members of any 
institution similar to the Institute of Chartered Accountants of India or from practicing the profession of 
accountancy or subjects them to unfair discrimination in that country, no subject of any such country shall 
be entitled to become a member of the Institute or practice the profession of accountancy in India. 

(2)  Subject  to  the  provisions  of  sub-section  (1),  the  Council  may  prescribe  the  conditions,  if  any, 
subject  to  which  foreign  qualifications  relating  to  accountancy  shall  be  recognised  for  the  purposes  of 
entry in the 3[Register  of members]. 

4[29A.  Power  of  Central  Government  to  make  rules.—(1)  The  Central  Government  may,  by 

notification, make rules to carry out the provisions of this Act. 

(2)  In  particular,  and  without  prejudice  to  the  generality  of  the  foregoing  powers,  such  rules  may 

provide for all or any of the following matters, namely:— 

1. Ins. by Act 9 of 2006, s. 24 (w.e.f. 17-11-2006).  
2. Ins. by Act 12 of 2022, s. 32 (w.e.f. 10-5-2022). 
3. Subs. by s. 33, ibid., for “Register” (w.e.f. 10-5-2022). 
4. Ins. by Act 9 of 2006, s. 25 (w.e.f. 8-8-2006).  

21 

                                                           
(a)  the  manner  of  election  and  nomination  in  respect  of  members  to  the  Council  under                      

sub-section (2) of section 9; 

(b)  the  terms  and  conditions  of  service  of  the  Presiding  Officer  and  Members  of  the  Tribunal, 

place of meetings and allowances to be paid to them under sub-section (3) of section 10B; 

1[(c) the form and fee for filing an information or a complaint under sub-section (1), the manner 
of deciding a complaint or information as actionable or non-actionable under sub-section (2) and the 
procedure of investigation under sub-section (7), of section 21; 

(d) the  procedure  while  considering  the  cases  by  the Board  of  Discipline  under sub-section (2) 

and time limit for payment of fine under sub-section (7), of section 21A; 

(da) the procedure while considering the cases by the Disciplinary Committee under sub-section 

(2) and time limit for payment of fine under sub-section (7), of section 21B;] 

(e) the  allowances and  terms  and  conditions  of  service  of  the  Chairperson  and members  of  the 

Authority and the manner of meeting expenditure by the Council under section 22C; 

(f) the procedure to be followed by the Board in its meetings under section 28C; and 

(g) the terms and conditions of service of the Chairperson and members of the Board under sub-

section (1) of section 28D.] 

30. Power to make regulations.—(1) The Council may, by notification in the Gazette of India, make 

regulations for the purpose of carrying out the objects of this Act 2***. 

(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may 

provide for all or any of the following matters:— 

(a) the standard and conduct of examinations under this Act; 

(b) the qualifications for the entry of the name of any person in the  3[Register of members] as a 

member of the Institute; 

(c)  the  conditions  under  which  any  examination  or training  may  be  treated  as  equivalent to the 

examination and training prescribed for members of the Institute; 

(d) the conditions under which any foreign qualification may be recognised; 

(e)  the  manner  in  which  and  the  conditions  subject  to  which  applications  for  entry  in  the 

3[Register of members] may be made; 

(f) the fees payable for membership of the Institute and the annual fees payable by associates and 

fellows of the Institute in respect of their certificates; 

* 

* 

4* 
(h) the particulars to be entered in the 3[Register of members]; 
5* 
6[(j) the training of articled and audit 7[assistants], the fixation of limits within which premia may 
be charged from articled 7[assistants] and the cancellation of articles and termination of audit service 
for misconduct or for any other sufficient cause;] 

*; 

*; 

* 

* 

* 

* 

1. Subs. by Act 12 of 2022, s. 34, for clauses (c) and (d) (w.e.f. 10-5-2022). 
2.The words “and a copy of such regulations shall be sent to each member of the Institute” omitted by Act 9 of 2006, s. 26,                             

(w.e.f. 8-8-2006).  

3. Subs. by Act 12 of 2022, s. 35, for “Register” (w.e.f. 10-5-2022). 
4. Clause (g) omitted by s. 35, ibid. (w.e.f. 10-5-2022). 
5. Clause (i) omitted by s. 35, ibid. (w.e.f. 10-5-2022). 
6. Subs. by Act 15 of 1959, s. 23, for clause (j) (w.e.f. 1-7-1959). 
7. Subs. by Act 9 of 2006, s. 26, for “clerks” (w.e.f. 8-8-2006). 

22 

 
 
 
 
 
 
 
 
 
 
 
 
                                                           
(k)  the  regulation  and  maintenance  of  the  status  and  standard  of  professional  qualifications  of 

members of the Institute; 

(l) the carrying out of research in accountancy; 

(m) the maintenance of a library and publication of books and periodicals on accountancy; 

(n) the management of the property of the Council and the maintenance and audit of its accounts; 

(o)  the  summoning  and  holding  of  meetings  of  the  Council,  the  times  and  places  of  such 

meetings, the conduct of business thereat and the number of members necessary to form a quorum; 

(p) the powers, duties and functions of the President and the Vice-President of the Council; 

(q) the functions of the standing and other committees and the conditions subject to which such 

functions shall be discharged; 

1[(r) the qualification required for the purposes of sub-section (3) of section 5; 

(ra) the circumstances under which certificates of practice may be cancelled under sub-section (3) 

of section 6; 

(rb) the guidelines for granting or refusal of certificates of practice under clause (f) of sub-section 

(2) of section 15; 

(rc)  the  manner  of  appointment,  powers,  duties,  functions,  salaries,  fees,  allowances  and  other 
terms  and  conditions  of  service  of  the  Secretary  and  other  officers  and  employees  of  the  Council 
under clause (c) of sub-section (2) of section 16; 

(rd)  the  manner  of  preparing  annual  financial  statement  under  sub-section  (4)  and  the  annual 

accounts under sub-section (5), of section 18; 

(re) the manner of maintaining a Register of members of the Institute under sub-section (1) and 
the manner in which the annual list of members registered with the Institute shall be published under 
sub-section (3), of section 19; 

(rf)  the  manner  of  making  an  application  for  grant  of  registration  of  a  firm  and  the  terms  and 

conditions of such registration under section 20A; 

(rg)  the  manner  of  maintenance  of  Register  of  firms,  and  other  particulars  including  details  of 
pendency of any actionable information or complaint or imposition of penalty against the firm under 
sub-section (1) and sub-section (2) and the manner in which the annual list of firms registered with 
the Institute shall be published under sub-section (3), of section 20B; 

(rh) the manner of making available status of actionable information and complaints and orders 

passed under sub-section (9) of section 21; 

(ri) the manner of preparing panel of persons under clauses (a), (b) and (c) of sub-section (1) and 
the allowances payable to the Presiding Officers and members of the Boards of Discipline under sub-
section (8), of section 21A; 

(rj) the manner of preparing panel of persons under clauses (a), (b) and (c) of sub-section (1) and 
the allowances payable to the Presiding Officers and members of the Disciplinary Committees under 
sub-section (8), of section 21B; 

(rk) the salaries and allowances and conditions of service of officers and other staff of Authority 

under sub-section (2) of section 22E; 

(rl) the manner in which Regional Council may be constituted under sub-section (2) of section 23 

and the functions thereof; and] 

2* 

* 

* 

* 

* 

1. Subs. by Act 12 of 2022, s. 35, for clause (r) (w.e.f. 10-5-2022). 
2. Omitted by Act 9 of 2006, s. 26 (w.e.f. 8-8-2006). 

23 

 
 
 
 
 
 
 
                                                           
(t) any other matter which is required to be or may be prescribed under this Act. 

(3) All regulations made by the Council under this Act shall be subject to the condition of previous 

publication and to the approval of the Central Government. 

(4)  Notwithstanding  anything  contained  in  sub-sections  (1)  and  (2)  the  Central  Government  may 
frame the first regulations for the purpose mentioned in this section, and such regulations shall be deemed 
to have been made by the Council, and shall remain in force from the date of the coming into force of this 
Act, until they are amended, altered or revoked by the Council. 

1[30A.  Powers  of  Central Government  to  direct  regulations to  be  made  or  to  make  or  amend 
regulations.—(1)  Where  the  Central  Government  considers  it  expedient  so  to  do,  it  may,  by  order  in 
writing, direct the Council to make any regulations or to amend or revoke any regulations already made 
within such period as it may specify in this behalf. 

(2) If the Council fails or neglects to comply with such order within the specified period, the Central 
Government may make the regulations or amend or revoke the regulations made by the Council, as the 
case may be, either in the form specified in the order or with such modifications thereof as the Central 
Government thinks fit.] 

2[30B. Rules, regulations and notifications to be laid before Parliament.—Every rule and every 
regulation made and every notification issued under this Act shall be laid, as soon as may be after it is 
made or issued, before each House of Parliament, while it is in session, for a total period of thirty days 
which may be comprised in one session or in two or more successive sessions, and if, before the expiry of 
the session immediately following the session or the successive sessions aforesaid, both Houses agree in 
making  any  modification  in  the  rule,  regulation  or  notification,  or  both  Houses  agree  that  the  rule, 
regulation or notification should not be made or issued, the rule, regulation or notification, shall thereafter 
have effect only in such modified form or be of no effect, as the case may be; so, however, that any such 
modification or annulment shall be without prejudice to the validity of anything previously done under 
that rule, regulation or notification.] 

3[30C. Power of Central Government to issue directions.—(1) In the event of non-compliance by 
the Council of any provisions of this Act, the Central Government may give to the Council such general 
or special directions as it considers necessary to ensure compliance and the Council shall, in the discharge 
of its functions under this Act, comply with such directions. 

(2) If, in the opinion of the Central Government, the Council has persistently made default in giving 
effect to the directions issued under sub-section (1), it may, after giving an opportunity of being heard to 
the  Council,  by  notification,  dissolve  the  Council,  where  after  a  new  Council  shall  be  constituted  in 
accordance with the provisions of this Act with effect from such date as may be decided by the Central 
Government: 

Provided that the Central Government shall ensure constitution of a new Council in accordance with 

the provisions of this Act within a period of one year from the date of its dissolution. 

(3)  Where  the  Central  Government  has  issued  a  notification  under  sub-section  (2)  dissolving  the 
Council, it shall, pending the constitution of a new Council in accordance with the provisions of this Act, 
nominate any person or body of persons not exceeding five members to manage the affairs and discharge 
all or any of the functions of the Council under this Act. 

*30D.  Protection  of  action  taken  in  good  faith.—No  suit,  prosecution  or  other  legal  proceeding 
shall lie against the Central Government or the Council or the Authority or the Disciplinary Committee or 
the Tribunal or the Board or the Board of Discipline or the Disciplinary Directorate or any officer of that 
Government,  Council,  Authority,  Disciplinary  Committee,  Tribunal,  Board,  Board  of  Discipline  or  the 
Disciplinary Directorate, for anything which is in good faith done or intended to be done under this Act or 
any rule, regulation, notification, direction or order made thereunder. 

1. Ins. by Act 15 of 1959, s. 24 (w.e.f. 1-7-1959).  
2. Subs. by Act 9 of 2006, s. 27, for section 30B (w.e.f. 8-8-2006).  
3. Ins. by Act 9 of 2006, s. 28 (w.e.f. 8-8-2006). 
* Ins. by s. 28, ibid. (w.e.f. 17-11-2006). 

24 

                                                           
*30E.  Members,  etc.,  to  be  public  servants.—The  Chairperson,  Presiding  Officer,  members  and 
other  officers  and  employees  of  the  Authority,  Disciplinary  Committee,  Tribunal,  Board,  Board  of 
Discipline  or  the  Disciplinary  Directorate shall  be  deemed  to  be  public  servants  within the  meaning  of 
section 21 of the Indian Penal Code (45 of 1860).] 

1[31.  Construction  of  references.—Any  reference  to  a  chartered  accountant  or  a  registered 
accountant  or  a  certified  or  qualified  auditor  in  any  other  law  or  in  any  document  whatsoever  shall  be 
construed as a reference to a chartered accountant in practice within the meaning of this Act.] 

32. Act not to affect right of accountants to practise as such in Part B States.—Nothing contained 
in this Act shall affect the right of any person who, at the commencement of this Act, is entitled to engage 
himself  in  the  practice  of  accountancy  in  any  [Part  B  State]  under  any  law  in  force  in  that  State,  to 
continue to engage himself in the practice of accountancy in that State after the commencement of this 
Act. 

33. [Amendment of section 144, Indian Companies Act, 1913.]—Rep. by the Repealing and Amending 

Act, 1952 (48 of 1952), s. 2 and the First Schedule (w.e.f. 2-8-1952). 

1. Subs. by Act 15 of 1959, s. 25, for section 31 (w.e.f. 1-7-1959).  

25 

                                                           
1[THE FIRST SCHEDULE 

(See sections 21(3), 21A(3) and 22) 

PART I 

Professional misconduct in relation to chartered accountants in practice 

A chartered accountant in practice shall be deemed to be guilty of professional misconduct, if he— 

(1) allows any person to practice in his name as a chartered accountant unless such person is also a 

chartered accountant in practice and is in partnership with or employed by him; 

(2)  pays  or  allows  or  agrees  to  pay  or  allow,  directly  or  indirectly,  any  share,  commission  or 
brokerage  in  the  fees  or  profits  of  his  professional  business,  to  any  person  other  than  a  member  of  the 
Institute or a partner or a retired partner or the legal representative of a deceased partner, or a member of 
any other professional body or with such other persons having such qualifications as may be prescribed, 
for the purpose of rendering such professional services from time to time in or outside India. 

Explanation.—In this item, “partner” includes a person residing outside India with whom a chartered 

accountant in practice has entered into partnership which is not in contravention of item (4) of this Part; 

(3) accepts or agrees to accept any part of the profits of the professional work of a person who is not a 

member of the Institute: 

Provided that nothing herein contained shall be construed as prohibiting a member from entering into 
profit sharing or other similar arrangements, including receiving any share commission or brokerage in 
the fees, with a member of such professional body or other person having qualifications, as is referred to 
in item (2) of this Part; 

(4) enters into partnership, in or outside India, with any person other than a chartered accountant in 
practice or such other person who is a member of any other professional body having such qualifications 
as  may  be  prescribed,  including  a  resident  who  but  for  his  residence  abroad  would  be  entitled  to  be 
registered  as  a  member  under  clause  (v)  of  sub-section  (1)  of  section  4  or  whose  qualifications  are 
recognised by the Central Government or the Council for the purpose of permitting such partnerships; 

(5)  secures,  either  through  the  services  of  a  person  who  is  not  an  employee  of  such  chartered 
accountant  or  who  is  not  his  partner  or  by  means  which  are  not  open  to  a  chartered  accountant,  any 
professional business: 

Provided that nothing herein contained shall be construed as prohibiting any arrangement permitted in 

terms of items (2), (3) and (4) of this Part; 

(6)  solicits  clients  or  professional  work  either  directly  or  indirectly  by  circular,  advertisement, 

personal communication or interview or by any other means: 

Provided that nothing herein contained shall be construed as preventing or prohibiting— 

(i) any chartered accountant from applying or requesting for or inviting or securing professional 

work from another chartered accountant in practice; or 

(ii)  a  member  from  responding  to  tenders  or  enquiries  issued  by  various  users  of  professional 

services or organisations from time to time and securing professional work as a consequence; 

(7)  advertises  his  professional  attainments or  services,  or  uses any  designation or  expressions  other 
than chartered accountant on professional documents, visiting cards, letter heads or sign boards, unless it 
be a degree of a University established by law in India or recognised by the Central Government or a title 
indicating membership of the Institute of Chartered Accountants of India or of any  other institution that 
has been recognised by the Central Government or may be recognised by the Council: 

1. Subs. by Act 9 of 2006, s. 29, for the First Schedule and the Second Schedule (w.e.f. 17-11-2006).  

26 

                                                           
Provided  that  a  member  in  practice  may  advertise  through  a  write  up,  setting  out  the  services 
provided by him or his firm and particulars of his firm subject to such guidelines as may be issued by the 
Council; 

(8) accepts a position as auditor previously held by another chartered accountant or a certified auditor 
who has been issued certificate under the Restricted Certificate Rules, 1932 without first communicating 
with him in writing; 

(9)  accepts  an  appointment  as  auditor  of  a  company  without  first  ascertaining  from  it  whether  the 
requirements  of  section  225  of  the  Companies  Act,  1956  (1  of  1956)  1[or  sections  139  to  141  of  the 
Companies  Act,  2013  (18  of  2013)  or  any  other law pertaining  to  appointment of  auditors for the  time 
being in force] in respect of such appointment have been duly complied with; 

(10)  charges  or  offers  to  charge,  accepts  or  offers  to  accept  in  respect  of  any  professional 
employment, fees which are based on a percentage of profits or which are contingent upon the findings, 
or results of such employment, except as permitted under any regulation made under this Act; 

(11) engages in any business or occupation other than the profession  of chartered accountant unless 

permitted by the Council so to engage: 

Provided that nothing contained herein shall disentitle a chartered accountant from being a director of 
a company (not being a managing director or a whole time director) unless he or any of his partners is 
interested in such company as an auditor; 

(12)  allows  a  person  not  being  a  member  of  the  Institute  in  practice,  or  a  member  not  being  his 
partner to sign on his behalf or on behalf of his firm, any balance-sheet, profit and loss account, report or 
financial statements. 

Professional misconduct in relation to members of the Institute in service 

PART II 

A  member  of  the  Institute  (other  than  a  member  in  practice)  shall  be  deemed  to  be  guilty  of 

professional misconduct, if he being an employee of any company, firm or person— 

(1) pays or allows or agrees to pay directly or indirectly to any person any share in the emoluments of 

the employment undertaken by him; 

(2) accepts or agrees to accept any part of fees, profits or gains from a lawyer, a chartered accountant 
or  broker  engaged  by  such  company,  firm  or  person  or  agent  or  customer  of  such  company,  firm  or 
person by way of commission or gratification. 

PART III 

Professional misconduct in relation to members of the Institute generally 

A  member  of  the  Institute,  whether in  practice  or  not,  shall be  deemed  to  be  guilty  of  professional 

misconduct, if he— 

(1) not being a fellow of the Institute, acts as a fellow of the Institute; 

(2) does not supply the information called for, or does not comply with the requirements asked for, by 
the Institute, Council or any of its Committees, Director (Discipline), Board of Discipline, Disciplinary 
Committee, Quality Review Board or the Appellate Authority; 

1. Subs. by Act 12 of 2022, s. 36 clause (ii), for “Companies act, 1956 (1 of 1956)” (w.e.f. 10-5-2022). 

27 

                                                           
(3) while inviting professional work from another chartered accountant or while responding to tenders 
or enquiries or while advertising through a write up or anything as provided for in items (6) and (7) of 
Part I of this Schedule, gives information knowing it to be false. 

PART IV 

Other misconduct in relation to members of the Institute generally 

A  member  of  the  Institute,  whether  in  practice  or  not,  shall  be  deemed  to  be  guilty  of  other 

misconduct, if he— 

(1) is held guilty by any civil or criminal court for an offence which is punishable with imprisonment 

for a term not exceeding six months; 

(2) in the opinion of the Council, brings disrepute to the profession or the Institute as a result of his 

action whether or not related to his professional work. 

28 

THE SECOND SCHEDULE 

(See sections 21(3), 21B(3) and 22) 

PART I 

Professional misconduct in relation to chartered accountants in practice 

A chartered accountant in practice shall be deemed to be guilty of professional misconduct, if he— 

(1) discloses information acquired in the course of his professional engagement to any person other 
than his client so engaging him, without the consent of his client or otherwise than as required by any law 
for the time being in force; 

(2) certifies or submits in his name, or in the name of his firm, a report of an examination of financial 
statements unless the examination of such statements and the related records has been made by him or by 
a partner or an employee in his firm or by another chartered accountant in practice; 

(3) permits his name or the name of his firm to be used in connection with an estimate of earnings 
contingent  upon  future  transactions  in  a  manner  which  may  lead  to  the  belief  that  he  vouches  for  the 
accuracy of the forecast; 

(4) expresses his opinion on financial statements of any business or enterprise in which he, his firm, 

or a partner in his firm has a substantial interest; 

(5) fails to disclose a material fact known to him which is not disclosed in a financial statement, but 
disclosure  of  which  is  necessary  in  making  such  financial  statement  where  he  is  concerned  with  that 
financial statement in a professional capacity; 

(6) fails to report a material misstatement known to him to appear in a financial statement with which 

he is concerned in a professional capacity; 

(7) does not exercise due diligence, or is grossly negligent in the conduct of his professional duties; 

(8)  fails  to  obtain  sufficient  information  which  is  necessary  for  expression  of  an  opinion  or  its 

exceptions are sufficiently material to negate the expression of an opinion; 

(9) fails to invite attention to any material departure from the generally accepted procedure of audit 

applicable to the circumstances; 

(10)  fails  to  keep  moneys  of  his  client  other  than  fees  or  remuneration  or  money  meant  to  be 
expended in a separate banking account or to use such moneys for purposes for which they are intended 
within a reasonable time. 

PART II 

Professional misconduct in relation to members of the Institute generally 

A  member  of  the  Institute,  whether in  practice  or  not,  shall be  deemed  to  be  guilty  of  professional 

misconduct, if he— 

(1) contravenes any of the provisions of this Act or the regulations made thereunder or any guidelines 

issued by the Council; 

(2) being an employee of any company, firm or person, discloses confidential information acquired in 
the  course  of  his  employment  except  as  and  when  required  by  any  law  for  the  time  being  in  force  or 
except as permitted by the employer; 

(3) includes in any information, statement, return or form to be submitted to the Institute, Council or 
any  of  its  Committees,  Director  (Discipline),  Board  of  Discipline,  Disciplinary  Committee,  Quality 
Review Board or the Appellate Authority any particulars knowing them to be false; 

(4) defalcates or embezzles moneys received in his professional capacity. 

29 

1[(5) acts as an auditor of the company in contravention of the provisions of the Companies Act, 2013 

(18 of 2013).] 

Other misconduct in relation to members of the Institute generally 

PART III 

A  member  of  the  Institute,  whether  in  practice  or  not,  shall  be  deemed  to  be  guilty  of  other 
misconduct,  if  he  is  held  guilty  by  any  civil  or  criminal  court  for  an  offence  which  is  punishable  with 
imprisonment for a term exceeding six months.] 

1. Ins. by Act 12 of 2022, s. 37 (w.e.f. 10-5-2022). 

30 

                                                           
